Bitcoin’s price may face pressure from the growing labor market in the United States, the world’s largest economy.
The recent nonfarm payrolls report, released on June 7, tracks the change in employment numbers from the previous month, excluding the farming sector. With the nonfarm payrolls surpassing expectations, investors might start worrying about potential tightening of monetary policies. This could lead to Bitcoin (BTC) ending the week below the $70,000 threshold as investors shy away from risky assets, as per analysts at Bitfinex.
Despite predictions, the nonfarm payrolls report revealed a stronger performance with the addition of over 272,000 new jobs, exceeding the initial estimate of 182,000.
In another significant economic development, the European Union followed Canada in cutting interest rates, making it the second major economy to do so. The European Central Bank (ECB) reduced its benchmark lending rate from 4% to 3.75% ahead of the EU-wide elections. This move marks the first interest rate cut by the central bank in five years. Analysts at Bitfinex believe that this decision could inject more liquidity into Bitcoin.
Bitcoin’s trading remained relatively stable on the daily chart but experienced a 0.8% drop in the hour leading up to 1:00 pm UTC, trading at $71,186 according to CoinMarketCap data.
Positive institutional inflows from U.S. spot Bitcoin ETFs could help Bitcoin close the week above $70,000. In the current week alone, U.S. spot Bitcoin ETFs have gathered over $1.54 billion in net inflows. Based on the current inflow rate, these ETFs are projected to accumulate 3.74% of Bitcoin supply annually according to Dune data.
The U.S. Bitcoin ETFs saw a total inflow of $488.1 million on June 5, with a record inflow of $886.6 million on June 4. By February 15, these ETFs accounted for approximately 75% of new investments in the largest cryptocurrency globally as it crossed the $50,000 mark.